Australia will ask the World Trade Organization to investigate punitive Chinese tariffs on barley imports, it said Wednesday, in a significant escalation of tensions between the two nations.
Trade Minister Simon Birmingham announced the decision, saying Beijing’s 80% surcharge on barley imports from Australia “lack basis” and “are not underpinned by facts and evidence,” adding that similar action could be taken in other sectors.
Australia-China relations are at the lowest ebb since the 1989 Tiananmen Square crackdown, with Beijing rolling out a string of economic sanctions against Australian products.
“We are highly confident that based on the evidence, data and analysis that we have put together already, Australia has an incredibly strong case,” Birmingham said.
Australia’s barley exports to China had been worth about US$1 billion a year before a recent drought, and are used most notably in beer-making.
Experts say Beijing has mulled restricting Australian barley imports since 2018 amid worries that China – which produces only about 20% of the barley it needs – is overly dependent on imports.
But the tariffs came against the backdrop of fierce disputes between Canberra and Beijing that have prompted fears the measures were also politically motivated.
Each dispute has been billed as a technical issue, but many in Canberra believe the sanctions are retribution for Australia pushing back against Chinese influence at home and in the Asia-Pacific.
At least 13 Australian sectors have been subjected to tariffs or some form of disruption, including barley, beef, coal, copper, cotton, lobsters, sugar, timber, tourism, universities, wine, wheat and wool.
Australia had until now shied away from taking the disputes to the Geneva-based organization, fearing resolution could take years, open Australia up to retaliatory claims and worsen relations further.
The tensions with China have called into question Australia’s decades-old economic model – based on supplying the raw materials for China’s breakneck emergence as a modern economy.